Digital Rupee CBDC Set to Enhance Financial Inclusion
(7 December 2022 – India) The Reserve Bank of India (RBI)’s Central Bank Digital Currency (CBDC) may turn out to be the only long-term digital transaction to remain free of cost with enhanced security compared to other forms of digital assets.
That is the view of prominent payment industry bodies and fintech start-ups following the launch of the first pilot for the retail digital Rupee starting December 1. The RBI said that e₹-R will be implemented in phases in partnership with selected banks in key cities to begin with, and will be scaled up later. The first four banks that will be part of the pilot are the State Bank of India (SBI), ICICI Bank, Yes Bank, and IDFC First. Four more banks, Bank of Baroda, Union Bank of India, HDFC Bank, and Kotak Mahindra Bank will join the pilot subsequently, RBI had said.
“The launch of the e-Rupee is a very positive step towards bringing resilience, efficiency, and innovation to the payments system. Along with reducing the operational costs associated with physical cash management, it will also enhance settlement efficiency, spur innovation in cross-border payments, and offer the public the same benefits as any virtual currency without the risks associated with it” said Visa Group Country Manager, India & South Asia, Sandeep Ghosh.
"Retail CBDC will be a game changer. While the Unified Payments Interface (UPI) provides the features of fund transfer, this can become 100X bigger since it replaces cash transactions with digital currency directly issued by the RBI” Fintech Convergence Council of India Non-Executive Chairman, Navin Surya.
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